Warehouse for Lease - Changing of the tide
Build, build, build. Consume, consume, consume. Not anymore. Welcome to the new norm of commercial real estate. Over the last two decades, before the oil crash, banks were lending money on a signature and good will. As a result developers, eager to make a fee, put up millions of square feet of bulk distribution space around the country. Now that market is subject to downsizing, reducing, consolidating and liquidating. In many healthy markets like Houston, Dallas and Atlanta there is still a glut of distribution space for lease, despite the relative thriving commercial market. In other large cities, a tenant can almost name its price on bulk space for lease.
Our current slow to very slow trot to recovery is not enough to push lenders off their pedestals. Hopefully when things do begin to pick up pace, the shortage of new product as a result of stringent lending practices will force rental rates to new highs.